that is going to be a surprise for all of us. and i'm out of here, good night from washington. see you tomorrow night. stay here. >> bret: fox news live coverage the president's address and the republican response. before the president begins, let's set the stage. we go to our new chief white house correspondent, ed henry. >> reporter: good evening many top aides say the president is going to be blunt. he's going to say we are on the verge of an economic meltdown. time to end bickering and come together. i said to one top adviser haven't the republicans scored by getting the president to give and give on spending cuts while he has waved the white flag on tax. this adviser said no. it shows the president is flexible. the republicans are not giving an inch. they think that helps them win

independent voters that's his target tonight this at the end of an intense day. >> we had dueling debt plans. bane we are up to three trillion in it cans. reid up to 2 1/2 trillion in cuts. they both face an uncertain fate. some are saying both parties will take a hit if the u.s. defaults. the president knows the buck stops with him. he does not want to be the first president to have a major default on his watch. >> bret: ed henry outside the white house. we head back after the speech. now the east room of the white house. the president walking down cross hall as he gets ready to address the debt crisis. the president of the united states. >> the president: good evening. tonight i want to talk about the debate we've been having in washington over the national debt. day debate that deck lay affects the lives of all americans. for the last decade we've spent more money than we take in. in the year 2000, the

government had a budget surplus. but, instead of using it to payoff our debt the money was spent on trillions in new tax cuts. two wars and an expensive prescription drug program were added to our nation's credit card. as a result, the deficit was on track to top one trillion dollars the year i took office. to make matters worse, the recession meant there was less money coming in and it required us to spend even more. on tax cuts for middle class families to spur the economy, on unemployment insurance. on aid to states so we could prevent teamers, firefighters and police officers from being laid off. these emergency steps also added to the deficit. now, every family knows a little credit card debt is manageable. but if we stay on the current path, our growing debt could cost jobs and do serious damage to the economy.

more of our tax dollars will go toward paying often interests on our loans. businesses will be less likely to open up shop and hire workers in a country that can't balance its books. interest rates could climb for everyone who borrows money. the homeowner with the mortgage. the student with a college loan. the corner store that wants to expand. and we won't have enough money to make job creating investments in things like education and infshqiu(ui+ñ or pay for medicare andj1g medicaid. because neither party is blameless for the decisions that lead to this problem, both parties have a responsible to solve it. over the last several months, that's what we've been trying to do. i won't bore you with the details of every plan or proposal. basically, the debate has centered around two different approaches. the first approach says, let's live within our means by making serious historic cuts in government spending.

let's cut domestic spending to the lowest level since dwight eisenhower was president. let's cut defense spending at the pentagon by hundreds of billions of dollars. let's cut out waste, fraud and health care programs like medicare. at the same time let's make modest adjustments so medicare still there for future generations. finally, let's ask the wealthiest americans and biggest corporations to give up some of their breaks in the tax code and special deductions. this balanced approach asks everyone to give a little, without requiring anyone to sacrifice too much. it would reduce the deficit by around four trillion . and put us on a path to pay down our debt. the cuts wouldn't happen so abrupt did they would be a drag on our economy or prevent us from helping small businesses and middle class families get back on their feet right now. this is approach is also bipartisan. while many in my party aren't

happy with the painful cuts it makes, enough will be willing to accept them if the burden is fairly shared. while republicans might like to see deeper cuts and no revenue at all, there are many in the senate who have said, yes, i'm willing to put politics aside and consider this approach, because i care about solving the problem. and to his credit, this is the kind of approach the republican speaker of the house john boehner, was working on, with me, over the last several weeks. the only reason this balanced approach isn't on its way to becoming law right now is because a significant number of republicans in congress are insisting on a different approach. a cuts-only approach. an approach that doesn't ask the wealthiest americans or biggest corporations to contribute anything at all. and because nothing is asked of those at the top of the income scale, such an approach would close the deficit only with more severe cuts to

programs we all care about. cuts that place a greater burden on working families. so, the debate right now isn't about whether we need to make tough choices. democrats and republicans agree on the amount of deficit reduction we need. the debate is about how it should be done. most americans regardless of political party don't understand how we can ask a senior to pay more for her medicare before we ask a corporate jet owner or the oil company to give up tax breaks that other companies don't get. how can we ask a student to pay more for college before we ask hedge fund managers to stop paying taxes at a lower rate than their secretaries? how can we shrafp funding for education and clean -- slash funding for education and clean energy before we ask people like me to give up tax breaks we don't need and didn't ask for? that's not right. it is not fair. we all want a government that lives within its .

there's still things we need to pay for as a country. things like new roads and bridges. weather satellites and food inexpect . services to veterans and medical research. keep in mind that under a balanced approach. the 98% of americans who make un$250,000, would see no tax increases at all. none. in fact, i want to extent the payroll tax cut for working families. what we are talking about under a balanced approach is asking americans whose incomes have gone up the most over the last decade, millionaires and billionaires, to share in the sacrifice everyone else has to make. i think these patriotic americans are willing to pitch in. in fact, over the last few decades they've pitched in every time we passed a bipartisan deal to reduce the deficient. >> the first time a deal was passed, a predecessor of mine made the case for a balanced

approach by saying this: would you rather reduce deficits and interest rates by raising revenue from those who are not now paying their fair share or accept larger budget deficits higher interest rates and higher unemployment? and i think i know your answer. those words were spoken by ronald reagan. but today many republicans in the house refuse to consider this kind of balanced approach. an approach that was pursued not only by president reagan, but by the first president bush, by president clinton, by myself and by many democrats and republicans in the united states senate. so, we're left with a stalemate. what makes today's stalemate so dangerous is that it has been tied to something known as the debt ceiling. a term that most people outside of washington have probably never heard of before. understand, raising the debt ceiling does not allow

congress to spend more money. it simply gives our country the ability to pay the bills that congress has already racked up. in the past, raising the debt ceiling was routine. since the 50s, congress has always passed it. and every president has signed it. president reagan did it 18 times. george w. bush did itself event times. and we have to do it by next tuesday, august 2nd, or else we won't be able to pay all of our bills. unfortunately, for the past several weeks, republican house members have essentially said that the only way they will vote to prevent america's first ever default is if the rest of us agree to their deep spending cuts-only approach. if that happens and we default, we would not have enough money to pay all of our bills. bills that include monthly social security checks. veterans' benefits and government contracts we've

signed with thousands of businesses. for the first time in history, our country's aaa credit rating would be downgraded. leaving investors around the world to wonder whether the united states is still a good bet? interest rates would skyrocket on credit cards, on mortgages and on car loans. which amounts to a huge tax hike on the american people. we would risk sparking a deep economic crisis. this one caused almost entirely by washington. so defaulting on our obligations is a reckless and irresponsible outcome to this debate. and republican leaders say they agree, we must avoid default. but the new approach that speaker boehner unveiled today, which would temporarily ask 10 the debt sealing in exchange for spending cuts would force us to once again face the threat of default six months from now. in other words, it doesn't

solve the problem. first of all, a six month extension of the debt ceiling might not be enough to avoid a credit downgrade and higher interest rates that all americans would have to pay as a result. we know what we have to do to reduce our deficits. there's no point in putting the economy at risk by kicking the can further down the road. but there's an even greater danger to this approach. based on what we've seen these past few weeks, we know what to expect six months from now. the house of representatives will once again refuse to prevent default unless the rest of us accept the cuts-only approach. again, they will refuse to ask the wealthiest americans to give up their tax cuts or deductions. again, they will demand harsh cuts to programs like medicare. and once again, the economy will be held captive, unless they get their way. this is no way to run the greatest country on earth. it is a dangerous game that

we've never played before and we can't afford to lay it now. not when the jobs and livelihoods of so many families are at stake. we can't allow the american people to become collateral damage to washington's political warfare. congress now has one week left to act. they are still -- the senate has introduced a plan to avoid default which makes a down payment on deficit reduction and ensures we don't have to go through this again in six months. i tnk's a much better approach. serious deficit reduction would still require us to tackle tough challenges of entitlement and tax reform. either way, i've told leaders of both parties they must come up with a fair compromise in the next few days that can pass both houses of congress and a compromise that i can sign. i'm confident we can reach this compromise. despite our disagreements,

republican leaders and i have found common ground before. i believe that enough members of both parties will ultimately put politics aside and help us make progress. now i realize that a lot of new members of congress and i don't see eye-to-eye on many issues. but we were each elected by some of the same americans for some of the same reasons. yes, many want government to start living within its means. and many are fed up with a system in which the deck seems stacked middle class americans in favor of the wealthiest few. do you know what people are fed up with most of all? they are fed up with a town where compromise has become a dirty word. they work all day long. many of them scraping by, just to put food on the table. when these americans come home at night, bone tired, and turn on the news, all they see is the same partisan three-ring circus here in washington.

they see leaders who can't seem to come together and do what it takes to make life just a little bit better for ordinary americans. they are offended by and they should be. the american people may have voted for divided government but they didn't vote for a dysfunctional government of the so i'm asking you all to make your voice heard. if you want a balanced approach to reducing the deficit, let your member of congress know. if you believe we can solve this problem through compromise, send that message. america, after all, has always been a grand experiment in compromise. as a democracy made up of every race and religion, where every belief and poeupts of view is welcomed, we have put to the test time and again the proposition at the heart of our founding. that out of many we are one. we've engaged in fierce and passionate debates about the

issues of the day. but from slavery to war, from civil liberties to questions of economic justice, we have tried to live by the words that jefferson once wrote: every man cannot have his way in all things. without this mutual disposition we are disjointed individuals. but not a society. history is scattered with the stories of those who held fast to rigid ideologies and refused to listen to those who disagreed. those are not the americans we remember. we remember the americans who put country above self and set personal grievances aside for the greater good. we remember the americans who held this country together during its most difficult hours. who put aside pride and party to form a more perfect union. that's who we remember. that's who we need to be right now. the entire world is watching.

so let's seize this moment to show why the united states of america is still the greatest nation on earth. not just because we can still keep our word and meet our obligations. but because we can still come together as one nation. thank you. god bless you. and may god bless the united states of america. >> bret: mr. obama in the east room. not have a crowd there. speaking for about 15 minutes. the president started his address pushing for a big deal, a big plan. he blamed a significant number of republicans in congress for insisting on a cuts-only approach to the debt ceiling increase. the president talked again as he has about about millionaires and billionaires not paying their fair share he quoted president reagan. president obama says short term debt ceiling extension would lead to another standoff in six months.

saying that is no way to run the u.s. government. he called on leaders from both parties to negotiate and called on the american people to call their lawmakers to tell them to make a deal to come to a compromise. to avoid default in what he called a financial problem for the united states, a big problem. while we wait for the republican response from house speaker john boehner, let's go to chief white house correspondent ed henry. >> reporter: the contrast was striking. the president flat out saying the other guys are part of a three-ring circus i'm about common ground, balance, compromise. that's because as we noted before he is trying to move the middle of the electorate. those independent voters to his side. how many times did we hear, balanced approach? i counted seven times that he said that. and he framed it as, look this is fundamental fairness. seniors against oil companies, hedge fund managers, corporate jet owners. trying to say i'm on the sigh of the little guy they are on

the side of the corporate interests. most interesting this gamble he took by trying to drive a wedge between speaker boehner and the matter by saying boehner was with me. he wants to go my way. does that push boehner further right? we'll see. >> bret: good question, thank you ed. we've heard from the president. the last time a rival party responded live to a presidential address besides the state of the union was a speech by president george w. bush on iraq and a response by democratic senator jack reed from rhode island. four years later the topic the debt crisis. the response, house speaker john boehner. good eve -- evening i'm john boehner. these are difficult times in the life of our nation. millions are looking for work and have been for sometime. the spending binge going on in washington is a big part of the reason why. before i served in congress, i ran a small business in ohio. i was amazed at how different

washington, d.c. operated than every other business in america. businesses make hard choices to pay bills, live within their means in washington, more spending and more debt is business as usual. i've got news for washington, those days are over. president obama came to congress in january and requested business as usual. another routine increase in the national debt. we in the house said, not so fast. here was a president asking for the largest debt increase in american history on the heels of the largest spending binge in american history. here's what we got for that massive spending binge. a new health care bill most never asked for. stimulus bill producing material for late night comedians than producing jobs. national debt so out of hand it sparked a crisis without precedent in my lifetime or yours. the united states cannot default on its debt

obligations. jobs and savings of too many americans are at stake. we told the president in january, the american people will not accept an increase in the debt limit without significant spending cuts and reforms. over the last six months we've done our best to convince the president to partner with us to do something dramatic to change the fiscal trajectory of our country. something that will boost confidence if our economy. help businesses get back on track. last week the house passed such a plan. with bipartisan support. it is called the cut, cap and balance act. it cuts and caps government spending. and paves the way for a balanced budget amendment to the constitution, which we believe is the best way to stop washington from spending money it didn't have. before we passed the bill in the house, the president said he would veto it. i made a sincere effort to work with the president to identify a path forward that

would implement the principles of cut, cap and balance in a manner that could secure bipartisan support and be signed into law. i'll tell you, i gave it my all. unfortunately, the president would not take yes for an answer. even when we thought we might be close to an agreement the president's demands changed. the president has often said we need a balance approach. which in washington means, we more, and you pay more. having a small business, i know tax increases will destroy jobs. the president is adamant we cannot make fundamental changes to our entitlement programs. as a father of two daughters, i know these perhaps won't be there for them and their kids unless significant action is taken now. the sad truth is that the president wanted a blank cheque six months ago and he wants a blank cheque today. this is just not going to happen. you see, there's no stalemate here in congress. the house passed a bill to raise the debt limit with

bipartisan support this week, while the senate is struggling to pass a bill filled with phony accounting and washington gimmicks, we are going to pass another bill. one developed with the support of the bipartisan leadership of the u.s. senate. obviously, i expect that bill can and will pass the senate. and be spent to the president for his signature. if the president signs it, the crisis atmosphere that he has created will disappear. the debt limit will be raised. spending will be cut by more than one trillion dollars. and a serious bipartisan committee of the congress will begin the hard but necessary work of dealing with the tough challenges our nation faces. the individuals doing this work will not be outsiders. but elected representatives of the people doing the job they were elected to do, as outlined in the constitution. those decisions should be made based on how they are going to affect people struggling to get a job, not how they will affect some politicians's chances of getting reelected. this debate isn't about

president obama and house republicans. it isn't about congress and the white house. it is about what is standing between the american people and the future we seek for ourselves and our families. i've always believed the bigger the government, the smaller the people. right now we've got a government so big and expensive that it is zapping the drive out of our people and keeping our economy from running at full capacity. the solution to this crisis is not complicated. if you are spending more than you are taking in, you need to spend less of it. there's no symptom big government more menacing than our debt. break its grip and we begin to liberate our economy and our future. we were up to the task. i hope president obama will join news this work. god bless you and your family. and god bless the united states of america. >> bret: house speaker bane we are a five minute response to president obama. saying the united states cannot default on is debt obligation. the speaker mentioning the

cut, cap and balance bill that passed the house but has since been stopped in the senate by the democratic majority there. speaking saying about negotiation at the white house: the president would not take yes for an answer. even when we thought we might be close on an agreement. the president's demands changed. speaker also calling for a big deal, but saying there is another deal on the table that he expects to pass the house. let's get reaction to these two speeches from our panel. steve hayes, ab stoddard, and charles krauthammer. >> i thought the president did exactly what we thought. he made the case for how frightening default would be. he blamed it all on republicans. he believes this is the first time the american public is tuning in. he believes a primetime address would capture their attention and be a place to say the republicans are holding the economy hostage or

captive is what he said. and americans should be offended by our politicaller. he's asking them to swarm the switch board at the congress tomorrow with their thoughts on a balanced approach. he wants to be back in the game. he believes big grand bargain is still alive. i thought the speaker, though his plan might not pass wednesday, did a good job of telling the american people that they have passed a debt increase in the house. that they hung in with negotiations with the president. that he moved the goalpost. and in that sense, i think they both did well on the points they wanted to make. >> bret: speaking of moving the goalpost harry reid has a new plan out that has no tax increases. no revenue increases. arguably if you use the terminology the president uses, a balanced approach, the leader of the democratic senate is not doing what he wants. >> this is i think the take away from the speech.

the president was talking to people beyond washington. he was ignoring the developments of the past couple days that had shift -- had soon a shift of this discussion from the white house and congress to an intracongressional discussion. harry reid presented the kind of plan that you described, something with no tax increases. the kind of thing the president spent three, four minutes at the beginning of this address, railing on. deriding. suggesting was imbalanceed and irresponsible. he was in effect criticizing harry reid for doing what harry reid is doing right now. >> bret: charles, you were shaking your head through most of it. >> i thought i was cynical until i heard that speech. it was purely partisan. it was meant as a campaign speech. and i think it was a speech from yesterday. it has nothing to do with the current negotiations. he's pushing the balanced approach. a word which he knows is tested by pollsters as

appealing to independents. that's all this is about. he used all the cliches that would help him with that constituency. steve indicated, the democrats in the congress have already accented it is only going to be about cuts. -- already accepteds it is only going to be about cuts. he is talking about the corporate jets again and again. starred the speech blame it all on beach, 3 1/2 years in. wabasso -- all on bush, 3 1/2 years in. he talked about himself as being a new reagan. liberal reagan. reagan could do one thing that almost no modern president could do. he could go to the nation and sway an issue. this is obama thinking he's going to achieve that. i don't know if he is going to succeed or no but he spoke to the american people. remember, what he told eric cantor, you call my bluff, i'll go to the people. that's his attempt, let's see

if it works. >> bret: ab does this sway, change the dynamic with seven days left to go? >> first of all ronald reagan, as everyone at this table knows, would not be able to win the republican nomination in the republican party of 2011, period this is one of the reasons that president obama continues to mention him. this is, if you look at polling from last week's national polling that came out on how vastly these numbers have moved on the debt ceiling question, i believe the president believes that the momentum is on his side. people are paying attention, worried about mutual funds and their mortgage they are afraid of default and they are going to respond to his call for a balanced approach. >> i think the president spoke 60 times during the health care crisis we saw it become less popular. we've seen the same since july 1st, to today the president's approval ratings have dropped. >> bret: thanks for joining us for this special fox news coverage. speak we will of course have a

complete wrap up of this fast moving story tuesday night on special report. now up to new york and my friend and colleague sean hannity. >> sean: washington stuck in a stalemate. the only way out is compromise by both parties that is the president's message tonight. he places blame once again on president bush. arguing the deficit was on track to top one trillion the year he took office and threatens a default, job loss, serious damage to the economy if the debt ceiling is not raised. he repeats the same tired lines where he wages class warfare, calling for more tax increases on the so-called wealthy. tonight the u.s. is one week and a day from reaching is borrowing limit. following the president's address, john boehner delivered the gop response insisting there is no stalemate in congress. and the american people will not accept an increase in the

debt limit without significant cuts and reforms. the days of more spending and more debt are over for this country. early are today, two new and different proposals were offered up by harry reid. the speaker of the house boehner. as you heard from the president he's refusing to support any short term fix if it means bringing us to the brink of -- where does this leave the country? here with us dick morris. with you were there for the government shutdown in '95. here's the interesting point. the words balanced approach. my approach is balanced. all these other guys are extremists. predictable, boring, blame bush, blame bush, create fear, scare old people, class warfare. he can't -- there's nothing new with him here. >> i agree. two things are notable about this speech. he has placed himself to the left of the senate democrats.

harry reid and the democrats in the senate friday signed off on a deal that had no tax increases. the republicans and they agreed to do it all through spending cuts. now obama is rejecting that deal going to the left of his own party. >> sean: why do you think that is? why do you think he would do that? >> i asked herman cain that question he said it is in his dna. it is not in the dna of harry reid. he's to the left of reid now. i think the second thing we need to focus on. when he says that we're facing a disaster if there is a default, i hate to disrespect the president, but he's lying. you now doesn't claim we are going to default on our debt. he says we'll default on our obligations. there's enough money to pay debt, social security, medicare, military pay and 100 other things. the obligations he's talking about are the bureaucrats and

lt labor department and commerce department and agriculture department and the state department. those obligations, not the obligations we really care about. this is total fear tactics and it is a big lie. >> sean: we take in 200 billions a month. we will pay the interest on the debt. i want the elderly, those that worked hard, you will get your social security check, regardless, medicare, medicaid paid for, military paid for. >> the bluff we can call is if the republicans don't raise the debt limit and armageddon descends it won't bother anybody. so you won't get your passport. >> sean: something i notice about the president. i have a good friend from hillsdale college he's a scholar. he asked what is the president going to say? i said predictable. blame bush, class warfare.

corporate jets and then scare old people. he's shallow. this president, he's never given his idea on paper. americans don't know this. he doesn't have a plan. his plan didn't get a single vote in april. >> that's all true. and he consistently misses the main point of the argument. which is, if you increase taxes on the top 2% of the country, by taking away their mortgage interest deduction, it is going to dry up almost half of the home building in the united states. so every carpenter, every mason, every brick layer, it didn't matter how much money you make, you are going to lose your job and wages, because the rich won't be able to have a mortgage interest deduction so they are not going to bill houses that are that expensive. this trickle down of misery, which is really what would happen -- >> sean: sounded like the misery index of carter. >> now it is well on the other

foot. it is his misery index. the other thing is more subtle. i think he knows there's going to be a deal. i think he knows that the senate and the house are close to each other. they both accept the same number of spending cuts. boehner's real, reids a little fuzz did claiming credit for ending the war that is going to end any way. they will work that out. republicans are saying we will give it only six months. reid is saying i want it after the election. republicans will give way on that. the republicans want a balanced budget amendment and caps on spending, but they are not going to close down the government for that. these people are -- they had a deal sunday night. he torpedoed it, obama what he is trying to do now is ride to the head of the class and make it his deal and take credit for when it emerges. >> sean: interesting, what you are best known for is polling. obviously, they focus group, they polled, balanced approach. they said we want to appear as balanced. all political.

most people don't know the president is reading a poll tested phrase. hang on, the poll is cut, cap and balance has the support of 64% of the american people. the balanced budget amendment, 75% of the american people that is a significant percentage. he's losing the argument and i think losing power everyday. >> it is huge. obviously you are right about that. when you ask people do you want only spending cuts even if those cuts don't touch medicare and social security? or spending cuts tax increases only on people making $250,000, 55-40 to the president's approach. that's why he is pushing what he is pushing today. >> sean: class warfare. >> he's not going to run against john boehner for president. he's going to run romney auerbach man or one of those folks and he's not going to have -- so we the economy tanks and continues to tank he's going to be in terrible shape. winning this argument in the sense that he's trying to do,

is a very minor game. and in the main the republican party is cleaning his clock. the republican party is getting 2 1/2 billion of cuts after he tried to get by with no cuts. >> sean: there is a problem. i spoke to john boehner this morning. he told me what his plan was 1.1 trillion in spending cuts. one trillion in an increase in the debt ceiling. he said if the president wants more we'll come back in six months. i don't think he's going to give in on that, i think you are wrong. here's the difficult part that i have, they are going to give the president the debt ceiling increase. they are going to give six republicans, six democrats, house and senate, they are going to have a commission. we've had nearly 20 missions and the debt has gone up 13 trillion. my question is, i don't think a conservative is going to support it if they don't know what the cuts are many if there are accounting gimmicks. if they are gutting defense. there are a lot of unanswered questions and specifics that

need to be had or else people are not going to sign on to a promise note later. >> that could force boehner and the house to do only a one trillion january extension. because, you really only have about a trillion in cuts that we can really say cut this, cut that. the other trillion and a half is with this commission that is going to design it. you are right commissions have always failed to do it. i think the republicans may take the position that either you itemize cuts with the same specificity or we will be back in six months and then you have to do it. >> sean: the one thing i did like force the senate to have a vet on the balanced amendment which they punted on with cut, cap and balance last week. they wouldn't bring it up for a vote. their no-vote meant -- >> let's remember something, the president does not get a voice on the constitutional amendment. >> sean: that's a good point. dick morris, good to see you. plenty more to come. when we come back, senator

mike lee, strong conservative with reaction to president obama and speaker boehner's speech. that plus our great, great american panel i. ♪

[ male announcer ] how could a luminous protein in jellyfish, impact life expectancy in the u.s., real estate in hong kong, and the optics industry in germany? at t. rowe price, we understand the connections of a complex, global economy. it's just one reason over 75% of our mutual funds beat their 10-year lipper average. t. rowe price. invest with confidence. request a prospectus or summary prospectus with investment information, risks, fees and expenses to read and consider carefully before investing. it all happened so fast. it was clearly too late for me to do anything as my mercedes collision system automatically kicked in. the next thing i know, the mercedes stopped itself. ♪ watching what mercedes has done

in bringing together these sensors in a car with software that has the ability to save your life. that's magical software. [ male announcer ] the innovation, the engineering of mercedes-benz. the best or nothing.

>> sean: the stalemate drags on. while the president"x is attempting to get out in front isd several meetings the one thing we still have yet to see is an actual plan of his own. here with more reaction tonight big debate and the speeches by president obama and john boehner is senator mike lee. good to see you. >> good to be with you. >> sean: one thing i've learned about this president. i'm not patting myself on the back. he's so predictable. bumper stickers, slogans, 1970 playbook, class warfare, scaring old folks no plan of

his own. they have his poll tested line, balanced approach. the question is, will enough americans see through his predictable propaganda and his little talking points? >> i think they will. the man, as you pointed out is stuck in the 70s and he can't get out. class warfare as much fun as it may be for the president is not going to solve this problem way is going to solve this problem is when congress imposes upon itself permanent structural, binding spending reform of the sort we need and can obtain only through a constitutional amendment, restricting congress' ability to borrow. that's why i wrote "the freedom agenda." to point out until congress restricts its spending power through the contusion we are not going to get out of this mess. >> sean: he comes out of the box and blame president bush. he got his budgets passed. he had both houses of congress many he accumulated over four

trillion in obama debt, press denied. he didn't take if i of the blame himself. he is still blaming george w. bush. he described his spending as emergency steps, because the recession caused us to spend more. i mean is he capable of taking any responsibility? does he have to blame everybody for his bad decisions? >> apparently so. apparently he has to blame the fact that he made it worse. unemployment has gotten worse. availability of jobs, 9 ability of credit. surplus of homes on the market. number of people going into foreclosure all of this has gotten worse. why? because he made it worse. now he's telling us that the solution to our problems, problems caused by too much government is more government, more government funded by excess deficit spending. it has got to stop right now. >> sean: one of the things i got frustrated last week. i like the idea of ever -- the

idea of cut, cap and balance. deals with short term, takes care of social security recipients, pays for medicare raises the debt ceiling. it also dealt with structural issues in terms of how we got there. i thought that was -- they wouldn't even bring it up for a vet in the senate. can you tell me what -- a vote in the senate. can you tell me what his plan is? i have never read his plan. i have never seen his plan. >> no one knows it is for us to imagine what his imperial majesty might decide to cram down our throats next. you are right we had a plan. amid this call for compromise. he refuses to acknowledge that it is republicans, tea party republicans, like myself, especially who were behind the one and only legislative propose toll to do this i wrote the cut, cap and balance act and introduced the senate with 40 some odd co-sponsors. and passed it in the house a few days later. we were ready to debate, discuss, subject it to all

amendment processes and everything else that a normal piece of legislation guess through. harry reid and the democratic caucus decided to kill it. they tabled it before it had a single opportunity. not just for a vote on the merits for any debate discussion or amendment. now they want to convert this into a bipartisan commission setting aside the fact that 17 such commissions have failed in the past. we've got already two perfectly good constitutionally empowered bipartisan commissions one is the senate, one is the house. they are trying to bypass this and cram down the throats of the american people a precooked deal that their elected leaders won't have the opportunity to debate and discuss on the permits -- merits. >> sean: i like the fact they are going to get more in cuts than in terms of raising the debt ceiling. but i'm skeptical. we've been burned before. we've been down this road before. i can't support a plan that 12

members of congress are gonna vote on by themselves. i can't support that because i don't have enough faith in those 12 members. i don't know who the 12 members are. >> no one does know. no one knows who they will be. more importantly this process will arrange for a precooked deal. one that will be brought back to the actual congress to vote on without opportunity for amendment. >> sean: half americans don't pay federal income tax. 1 in 7 americans on food stamps. the president tries to make it corporate jets versus grandma on social security or medicare. that's how he's trying to frame this debate. half americans don't pay so he goes after the rich, wealthy, successful. if you make over $250,000 you won't pay. that includes every small business which creates 65, 70% of the jobs in this country. so he's not being hones when

he says people who don't make a lot of money are going to get their taxes raised, right? >> he's not being honest. when you raise taxes on that group you are raising taxes on the people we need to rely upon to invest money to place it at risk so we can create jobs in this country. that's the only way we are going to create jobs. tax increases wouldn't put a scratch on dent in the deficit problem that we have. >> sean: will fear-mongering have an impact with the american people? america's credit rating is going to be downgraded -- by the way standard & poor's is saying in 90 days it is likely to happen, moody's is saying the same in large part because of his policies which he won't acknowledge. any of the fear-mongering that interest rates will go up, rich won't pay their fair share, you think that is going to resonate? >> it may with some. at the end of the day, i believe the truth will prevail. and the american people are certain to realize the fact

that it is not just the immediate debt limit increase vote that puts it at stake for a credit rating downgrade. what is arguably an even greater risk and a more long term pervasive systemic one, raising the debt limit yet again without a permanent constrain. >> sean: what happens from here? -- >> conservatives in the house and senate continue to stand their ground on the cut, cap and balance act which has passed the house. which is the only legislative proposal introduced to address the debt limit issue. >> sean: 64% of the american people support it. 75% want a balanced budget amendment. seems like the most responsible, balanced plan. i would say that's a very balanced plan. senator good to see you. >> good to see you. >> sean: our great, great american panel is next. [ male announcer ] millions of men 45 and older

just don't feel like they used to. are you one of them? remember when you had more energy for 18 holes with your buddies. more passion for the one ya love. more fun with your family and friends. it could be a treatable condition called low testosterone or low t. come on, stop living in the shadows. you've got a life to live. [ male announcer ] so don't blame it on aging. talk to your doctor and go to isitlowt.com to find out more. excuse me. him? he's helping me get back to normal. hey, i don't even live in a floodplain. but i've got flood insurance, so i'm covered. how's that? nice. flood insurance, it helps make your home a home again. or, your me a me again. ooh, check it out fred, new foundation. got any of those in my size? [ female announcer ] only flood insurance covers floods. for a free brochure, call the number on your screen.

>> sean: tonight on our great, great american panel. bob beckel is back. she worked in the white house under george w. bush mercedes

viana schlapp is with us. he's author of the next great bold market, matt mccall is here. let's grade the speeches. obama, boehner, grades? >> i'm going to give obama a c -, boehner is going to get an a. the response was the best since he took over. he was right on point to the point. didn't go long. he looked great. blown away. >> sean: i agree with you the best. >> president obama "f" he went to try to push his increase of tax revenues attacking the republicans. really not facing up to the fact that he's the one that abandoned any negotiations. in essence i would definitely give him an "f." boehner definite "a."

>> sean: bob forget about the politics. >> i would say i thought boehner looked and sounded good. i thought on substance it wasn't close many obama a+, boehner hanging on trying to explain why they won't find an equitable deal. think about independents. >> sean: who obama is losing in droves. >> it is a very important constituency for him. we still have to put one of these people up. the fact is i think the way he laid it out, i know you don't like to hear this. it doesn't sound like the republicans are willing to give. i was interesting the way he divided the senate republicans from the house republicans. >> sean: this was strategy on his part. >> a good one. >> sean: mercedes, the president, it is like -- 19 70s rerun.

i felt like i was watching the brady bunch. the same cliches. the same, bob beckel was running campaigns on the same strategy. he's got nothing new. every time he speaks his numbers go down. >> it happened with obamacare. he kept trying to give these big speeches at these big moments and it didn't sell. i think what you found with speaker boehner, he gave a sincere speech. he kbgted with the american people saying i was a small business owner, i know what it takes. we can increase taxes now. we have to cut spending. we need get our government back in order. i think by taking those steps, i think obama really missed an opportunity and boehner captured that by connecting. >> sean: he was also able to deliver it and look in the camera and make his case and going last. i thought the way they put him in the environment similar to the president's, very smart, the backdrop.

>> he looked presidential. >> one thing i got from obama's speech was attack on the wealthy once again. how many times talk about -- blaming bush. >> the entire speech blaming bush. he's been doing this for years. like you said repeat of the same speech from the beginning. we are talking about something different but he has nothing else to start on. >> sean: greenberg and carville say this isn't working any more. >> before you get too far down on the poll thing the first poll had the president beating boehner substantiallism >> sean: poll by who? >> -- i will promise you tomorrow, that the president will beat him in polls head-to-head. >> speaker boehner is not running for president. >> that's not the point. [ talking over each other ] >> wait a second. we do know, because i was asked to call some democrats over the weekend. the cuts -- the inflation in

social security was real, serious. i'm not sure the president could have carry the democrats on it. and it medicare cuts were serious. >> sean: who came up with balanced approached? >> i'm not the one who came up with cut, stuck and balance. >> sean: you came close to cursing again. >> i did. i think boehner wanted the same deal that obama did. he couldn't sell it to his caucus. so we are -- let's talk about where we end up. two-phased deal. they both said we are going to pass the debt ceiling increase until january. then do it again in january. then they are going to have this 12 member commission which interestingly enough like the military bases you have to vote up or down, no amendments and we'll see. >> sean: i spoke to speaker boehner today. i think they've done a great job. for the house to have wrestled this issue from the president of the united states and no

new taxes there's a lot they've done well. passed cut, cap and balance, ryan plan, i have to get them credit. i don't think i can buy into 12 members of the house and senate, deciding later, after the debt ceiling is jack up, what the cuts are going to be. i need to know ahead of thyme. i'm a trust and verify guy. >> after six months having the same discussion we are not selling anything we are pushing it down the road. >> only way to keep the democrats in check is to put a timeline and say we have six months. we have to make entitlement reforms. >> sean: but wait, do you trust these 12 members, if you get seven of the 12, it is the law of the land. >> it will be challenging. >> sean: we are setting ourselves up to get burned. i think it is -- [ talking over each other ]

>> i will give the tea party people credit for drive this agenda to the front. i agree with you. but, there's a difference. they get their name from tea party people who threw tea into the boston harbor. these tea party people are throwing the economy of the united states -- >> absolutely not many >> can i finish. that's the problem with you republicans you never let anybody finish. [ talking over each other ] >> these people don't know what they are doing. they are not patriots, they are anarchists. >> sean: obama, biden and reid -- >> you guys want to -- [ talking over each other ] >> 98% of the american people do not get touched by tack in ses, only you and me do and we should pay. >> sean: i can say this, barack obama -- barack obama has last up to this point. now the republicans, have to get the --